CRS Annotated Constitution

Privilege
Taxes.—A state law requiring importers to take out a license
to sell imported goods amounts to an indirect tax on
imports and hence is unconstitutional.2010
Likewise, a franchise tax upon foreign corporations
engaged in importing nitrate and selling it in the
original packages,2011 a tax on sales by
brokers2012 and auctioneers2013
of imported merchandise in original packages, and a tax on
the sale of goods in foreign commerce consisting of an
annual license fee plus a percentage of gross
sales,2014 have been held invalid. On the other
hand, pilotage fees,2015 a tax upon the gross sales of
a purchaser from the importer,2016 a license
tax upon dealing in fish which, through processing,
handling, and sale, have lost their distinctive character
as imports,2017 an annual license fee imposed
on persons engaged in buying and selling foreign bills of
exchange,2018 and a tax upon the right of
an alien to receive property as heir, legatee, or donee of
a deceased person2019 have been held not to be
duties on imports or exports.

Property
Taxes.—Overruling a line of prior decisions which it thought
misinterpreted the language of Brown v. Maryland, the
Court now holds that the clause does not prevent a State
from levying a nondiscriminatory, ad valorem property tax
upon goods that are no longer in import transit.2020
Thus, a company’s inventory of[p.401]imported tires maintained at its whole distribution
warehouse could be included in the State’s tax upon the
entire inventory. The clause does not prohibit every “tax”
with some impact upon imports or exports but reaches
rather exactions directed only at imports or exports or
commercial activity therein as such.2021

Inspection
Laws.—Inspection laws “are confined to such particulars as,
in the estimation of the legislature and according to the
customs of trade, are deemed necessary to fit the
inspected article for the market, by giving the purchaser
public assurance that the article is in that condition,
and of that quality, which makes it merchantable and fit
for use or consumption.”2022 In Turner v.
Maryland,2023 the Court listed as
recognized elements of inspection laws, the “quality of
the article, form, capacity, dimensions, and weight of
package, mode of putting up, and marking and branding of
various kinds. . . .”2024 It sustained as an
inspection law a charge for storage and inspection imposed
upon every hogshead of tobacco grown in the State and
intended for export, which the law required to be brought
to a state warehouse to be inspected and branded. The
Court has cited this section as a recognition of a general
right of the States to pass inspection laws, and to bring
within their reach articles of interstate, as well as of
foreign, commerce.2025 But on the ground that, “it
has never been regarded as within the legitimate scope of
inspection laws to forbid trade in respect to any known
article of commerce, irrespective of its condition and
quality, merely on account of its intrinsic nature and the
injurious consequence of its use or abuse,” it held that a
state law forbidding the importation of intoxicating
liquors into the State could not be sustained as an
inspection law.2026

Clause 3.
No State shall, without the Consent of Congress, lay
any Duty of Tonnage, keep Troops, or Ships of War in time
of Peace, enter into any Agreement or Compact with another
State, or with a foreign Power, or engage in War, unless
actually invaded, or in such imminent Danger as will not
admit of delay.

The prohibition against tonnage duties embraces all
taxes and duties, regardless of their name or form,
whether measured by the tonnage of the vessel or not,
which are in effect charges for the privilege of entering,
trading in, or lying in a port.2027 But it does
not extend to charges made by state authority, even if
graduated according to tonnage,2028 for services
rendered to the vessel, such as pilotage, towage, charges
for loading and unloading cargoes, wharfage, or
storage.2029 For the purpose of
determining wharfage charges, it is immaterial whether the
wharf was built by the State, a municipal corporation, or
an individual. Where the wharf was owned by a city, the
fact that the city realized a profit beyond the amount
expended did not render the toll objectionable.2030
The services of harbor masters for which fees are allowed
must be actually rendered, and a law permitting harbor
masters or port wardens to impose a fee in all cases is
void.2031 A State may not levy a tonnage duty to
defray the expenses of its quarantine system,2032
but it may exact a fixed fee for examination of all
vessels passing quarantine.2033 A state license fee
for ferrying on a navigable river is not a tonnage tax but
rather is a proper exercise of the police power and the
fact that a vessel is enrolled under federal law
does[p.403]not exempt it.2034
In the State Tonnage Tax Cases,2035 an annual
tax on steamboats measured by their registered tonnage was
held invalid despite the contention that it was a valid
tax on the steamboat as property.